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re: Owning a 2nd rental right next door to another thoughts?
Posted on 8/7/17 at 10:20 am to hiltacular
Posted on 8/7/17 at 10:20 am to hiltacular
I don't think there is a problem owning 2 in the neighborhood. 5 in 1 neighborhood and maybe your concerned more. Write down a detailed review of your current property and rental history and maintenance. How long have tenants stayed? If you've done really well then you'll probably be fine owning 2 that both cash flow well. From those numbers it looks like you are at about a 12% yearly return which isn't horrible but not great either. Depends on your market. In my market anything less than 15% isn't a good deal. If it's been on the market that long low ball them. See what they say. Like others have said I'd focus on cash flow almost exclusively.
Things to consider
Cash flow > overall quality of neighborhood > hopeful appreciation > 2 houses in 1 neighborhood
Things to consider
Cash flow > overall quality of neighborhood > hopeful appreciation > 2 houses in 1 neighborhood
Posted on 8/7/17 at 10:30 am to tigereye58
quote:
5 in 1 neighborhood and maybe your concerned more
I currently own 4 in one neighborhood and two more in another neighborhood very close to it. Mine are situated very close to an AF base and in a good school district. The AF base will not be closing anytime in the foreseeable future and I don't think it would close in the next 20-25 years. If that is the case, all of them will be paid off and I should have 10-15 years of note free cash flow in that time period. I would buy every house in the neighborhood, if I could.
There is nothing wrong with owning multiple units/homes next-door to each other unless the area is questionable. It is all about location and trying to reasonably determine the future(10-15 years), IMO.
Posted on 8/7/17 at 1:19 pm to tigereye58
quote:
From those numbers it looks like you are at about a 12% yearly return which isn't horrible but not great either. Depends on your market. In my market anything less than 15% isn't a good deal.
This is more of what I was saying. I don't know if appreciation is the right term, but I personally don't have many "amazing" cash flow rentals in my area because anything decently low gets bought as a flip. That's why I compared it to multi families, because flippers leave those alone generally so you can find some better deals. They just don't have the sort of appreciation and stable neighborhoods like you can find in a single family.
I agree cash flow is better, but I don't see many good deals.
Some of the benefits I was thinking about is I should get cheaper Lawn service, guy can cut both at the same time. Very easy to check on both. I usually pick up all my checks in person and change their air filter at the same time. I've only owned the current property 2 years, but when I listed it for rent online I got something like 13 calls in the first 24 hours. So I know this will rent very easily to a good longer term (2+ year) tenant.
This post was edited on 8/7/17 at 1:21 pm
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